Auckland International Airport added a touch of realism to
its profit forecasts after yesterday reporting a profit for
the year ended June in line with most forecasts.
The company, which has shares in Queenstown Airport, reported
operating earnings of $355.2 million, up 7.4% on the previous
Total revenue was up 6.1% at $475.8 million and reported
profit rose 21.3% to $215.9 million.
Total passenger movements were up 3.8% at 15.1 million, with
international passengers rising 5.1% to 8.2 million and
domestic passengers up 2.2% at 6.9 million.
A final dividend of 7 cents per share was declared.
Craigs Investment Partners broker Chris Timms said the
outlook was disappointing but realistic.
The company did not want to produce forecasts it could not
''The outlook for 2015 is the same as it was for 2014 at this
time last year.''
Auckland Airport was forecasting reported underlying profit
to be between $160 million and $170 million.
Because of the lower shares on issue, guidance equated to a
2% to 9% lift in earnings per share.
Before digesting the latest result, Craigs had been
forecasting adjusted reported profit of $173 million for next
year, Mr Timms said.
Regulated aeronautical revenue growth of 8.6% was ahead of
the group's overall growth of 6.1%.
''We remain concerned this is an unhealthy differential as
the aeronautical revenue is on its way to exceed the
allowable return and is likely to be cut back at the next
price reset of 2018.
''In the presentation, the company has a slide on regulation.
"We continue to believe the company is not yet highlighting
the risk enough,'' Mr Timms said.
The retail contribution disappointed as the passenger spend
fell 2.4%, but at least it showed some improvement on the
first-half spend fall of 3.1%.
Staff costs were up 6.4% because of the accrual of long-term
incentive provisions after the continued strong company and
share price performance.
The accounts showed Auckland Airport's share of profit from
associated companies increased 17.2% to $11.6 million in the
period under review.
The profit share from North Queensland Airports increased
15.2% to $8.1 million, Queenstown Airport was up 25.7% at
$1.7 million and the Novotel Hotel was up 19.2% at $1.9
Mr Timms said the improved performance of Queenstown Airport
added substantially to the Queenstown Lakes District
Council's investment and to the Queenstown area overall.
''What Auckland Airport has is the expertise to attract
airlines to New Zealand and push their passengers through to
Company chairman Sir Henry van der Heyden said Auckland
Airport had focused on developing travel markets and
investing in the retail, property and long-term
infrastructure needed to take full advantage of growth
As a result there had been additional airline capacity and
services flying into Auckland.